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No Surprises From EU Summit, Surprises Expected From Rhineland-Palantine and Baden Württemberg Regional Elections

Tyler Durden's picture





 

Goldman provides a brief summary of the ongoing irrelevant EU summit (as discussed yesterday, with Portugal in flux no decision can be enacted for at least two months, or long after Portugal is declared technically insolvent). More important is keeping a track of picking up German regional elections which this weekend include Rhineland-Palantine and Baden Württember. As Dirk Schumacher says: "Although a change in government in BW would have no immediate
consequences for the ruling coalition in Berlin, it would be a heavy
blow in political terms nonetheless."

From Goldman Sachs:

No major surprise from EU summit.  Heads of governments will continue their talks today. The news flow over the last 24 hours, however, suggests that the final  conclusion will come broadly in line with expectations. EU governments again committed to increase the lending capacity of the EFSF to €440 and "it will be in place in June". We continue to think that the expansion will be achieved through a stepping-up of the guarantees. With respect to the ESM, the main change compared to the agreement reached earlier by finance ministers is a lengthening of the schedule by which countries will need to provide paid-in capital to the mechanism. The first tranche in 2013 will be now €16 billion instead of €40 billion and a further €64 billion will be paid over the following five years. http://www.consilium.europa.eu/uedocs/cms_data/docs/pressdata/en/ec/120292.pdf

Two important regional elections this Sunday.
There will be elections in two states - Rhineland-Palantine and Baden Württemberg - this Sunday. The election in Baden Württemberg, a traditional stronghold for chancellor Merkel's CDU, is of special importance. According to latest polls, the current ruling coalition of CDU and FDP is clearly trailing behind the two main opposition parties (SPD and Greens). Although a change in government in BW would have no immediate consequences for the ruling coalition in Berlin, it would be a heavy blow in political terms nonetheless.

At the same time, we do not expect the outcome of the elections to have any impact on the upcoming vote in the Bundestag on the expansion of the EFSF and the establishment of the ESM. Despite an occasional hostile rhetoric, MPs know that a rejection of the reformed rescue packages in the Bundestag would send massive shock waves through the system. Moreover, the difficulties of CDU and FDP in Baden Württemberg are not a direct consequence of the help packages. While these are certainly not popular among many voters of CDU and FDP, other issues are dominating the election campaign with nuclear power, not surprisingly, being the most hotly debated topic over the last two weeks. 

 

 


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Fri, 03/25/2011 - 07:36 | Link to Comment Tulli
Tulli's picture

Austerity bitchezzzzzz!!!!

(sorry, I appologise) - but being a member here and not doing at least one post like this....

/fun off

Fri, 03/25/2011 - 07:44 | Link to Comment Alcoholic Nativ...
Alcoholic Native American's picture

Austerity for all western nations for losing the war on terror.  Look out for Fascist!

Fri, 03/25/2011 - 08:05 | Link to Comment PY-129-20
PY-129-20's picture

"At the same time, we do not expect the outcome of the elections to have any impact on the upcoming vote in the Bundestag on the expansion of the EFSF and the establishment of the ESM. Despite an occasional hostile rhetoric, MPs know that a rejection of the reformed rescue packages in the Bundestag would send massive shock waves through the system. Moreover, the difficulties of CDU and FDP in Baden Württemberg are not a direct consequence of the help packages. While these are certainly not popular among many voters of CDU and FDP, other issues are dominating the election campaign with nuclear power, not surprisingly, being the most hotly debated topic over the last two weeks"

Two things are hotly debated there:

1) The new train station in Stuttgart, which is very unpopular. Also known as Stuttgart 21 or S21. Demonstrations for more than half a year now - with 10.000 to 100.000 people. It is seen as too ineffective and too costly - while at the same time we have to cut back and do austerity measures here as well. But all our fiscal discipline will be worthless...

2) Nuclear power was never very popular in Germany, especially since Chernobyl, which isn't too far away (some areas in Southern Bavaria are still contaminated). But also since protests in Gorleben flammed up last year. Since Fukushima things have turned and Merkel promised to do a moratorium to check all nuclear facilities. Economics Minister Rainer Brüderle has said that the snap decision to temporarily shut down seven nuclear reactors in Germany in the wake of the disaster in Fukushima was motivated by campaign tactics ahead of state elections this weekend. The claim threatens to rob Chancellor Merkel of what little credibility she had left.

http://www.spiegel.de/international/germany/0,1518,752943,00.html

Well, he owns a vineyard. In vino veritas...

Fri, 03/25/2011 - 08:48 | Link to Comment Pegasus Muse
Pegasus Muse's picture

Speaking of new train stations, when I fly in/out of Frankfurt I am always struck by the size of the egg DB is laying at the Fraport.  

http://www.ausbt.com.au/frankfurt-airport-gets-new-hilton-hotel-in-march-2011 

Fri, 03/25/2011 - 07:36 | Link to Comment Duuude
Duuude's picture

"At the same time, we do not expect the outcome of the elections to have any impact on the upcoming vote in the Bundestag on the expansion of the EFSF and the establishment of the ESM. Despite an occasional hostile rhetoric, MPs know that a rejection of the reformed rescue packages in the Bundestag would send massive shock waves through the system..."

 

"Which we own."

 

There, fixed it.

Fri, 03/25/2011 - 08:13 | Link to Comment unky
unky's picture

I live in Stuttgart and I problably gonna vote for the Left party because its one of the opposition partys here

Fri, 03/25/2011 - 09:59 | Link to Comment swissaustrian
swissaustrian's picture

Don´t waste your vote - socialism does´nt solve the problem

If you wanna protest against nukes, vote green (Özdemir).

Fri, 03/25/2011 - 11:38 | Link to Comment malek
malek's picture

Don't listen to the hacks that claim someone can "waste his vote." Vote what you tend towards, be it Die Linke or whoever!

Fri, 03/25/2011 - 12:23 | Link to Comment swissaustrian
swissaustrian's picture

Voting for a purely populistic party is nothing more than wasting your vote.

Fri, 03/25/2011 - 09:14 | Link to Comment pendragon
pendragon's picture

let's hope the voters do the right thing. bit puzzled as to why the ifo numbers are holding up so well...maybe the germans like writing checks to their tax dodging club med buddies

Fri, 03/25/2011 - 09:26 | Link to Comment Danack
Danack's picture

One surprise, http://www.bbc.co.uk/news/business-12858207 :

"UK Prime Minister David Cameron refused to respond to suggestions that Britain may have to pledge billions of pounds to any emergency funding."

Seriously? A non-euro member being asked to provide billions to support the Euro?

Fri, 03/25/2011 - 09:39 | Link to Comment snowball777
snowball777's picture

Who is going to take a haircut if they don't again? Hint: rhymes with crate smitten.

Fri, 03/25/2011 - 10:01 | Link to Comment gwar5
gwar5's picture

I guess Germany doesn't want to bail out Portgual and Greece anymore than North Dakota wants to bail out California, for being irresponsible, after they'd been telling them so for years.

Fri, 03/25/2011 - 10:22 | Link to Comment unununium
unununium's picture

My GS BS detector is going off full code 3.  Expect a MAJOR announcement out of the EU summit.

Fri, 03/25/2011 - 12:38 | Link to Comment Ahmeexnal
Ahmeexnal's picture

PORTUGAL IS GOING BACK TO THE ESCUDO!!!!!!!!!!

Fri, 03/25/2011 - 20:07 | Link to Comment edotabin
edotabin's picture

How so? The Euro has been the major trap for all these countries.  The Euro is going absolutely nowhere. It is the main axis of the scam. I pity the country that tries to leave. May they throw 1 or 2 small countries out? Highly unlikely but perhaps possible.  That would serve as a very false illusion that the "Euro is stable" and how "Europe is fiscally responsible"

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